Tarapur Transformers Ltd

Dear Members,

The Directors of your Company have pleasure in presenting Twenty Seventh Annual Report together with the Audited Accounts and Auditors' Report for the year ended 31st March, 2015.

1. Financial summary or highlights/ Performance of the Company (Standalone):The financial performance of the Company for the Year ended 31st March, 2015 is as summarized below: (Rs. In Lacs)

2. Performance Review:

The Turnover of the Company has decreased to Rs. 3730.59 Lacs, and the Company has incurred net loss of Rs. 330.00 Lacs for the F.Y 2014-15. The same is mainly due to fall in demand and rise in the prices of major raw materials and high interest rates.

3. Extract of Annual Return: Extract of Annual Return as provided under sub-section (3) of section 92 in Form No. MGT - 9. (Annexure 1).

4. Number of meetings of the Board of Directors: During the year 2014-15, 4 meeting of the Board of Directors held.

5. Directors' Responsibility Statement: The Directors' Responsibility Statement referred to in clause (c) of sub-section (3) of Section 134 of the Companies Act, 2013, shall state that:

a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit and loss of the company for that period;

c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

d) the directors had prepared the annual accounts on a going concern basis; and

e) the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively

6. Auditors' Report:

As regards Auditors remarks in the Audit report, comments of the Board of Directors are as under:-

a) Auditors' Remark:

The company has sent letters to customers in respect of trade receivables for confirming balances outstanding as at March 31,2015, but in most of the cases the customers have not sent written confirmation confirming the balance outstanding as at March 31,2015. In the absence of confirmation any provision to be made for adverse variation in the carrying amounts of trade receivable is not quantified.

Boards Comments on the same:

The Board considers all outstanding balance of customers as on 31st March, 2015 as good and recoverable.

b) Auditors' Remark:

The company has sent balance confirmation letters to parties who are not covered in the register maintained under Section 189 of the Companies Act, 2013, but in most of the cases the company have not received written confirmation confirming the balance outstanding as at March 31,2015. Further, in respect of loans granted, repayment of the principal amount was not as stipulated and payment of interest has also not been regular.

Boards Comments on the same:

Company has received balance confirmation from some of the Companies and are vigorously following up with the rest of the borrowers. Company expects to receive balance confirmation from all the companies to whomsoever advances have been given. Efforts are made to regularize arrears and recovery against overdue principal and interest

c) Auditors' Remark:

The Company has not provided for interest payable to Canara Bank amounting to Rs. 668.09 Lacs for the year ended 31st March 2015. The Company has also not made any provision for penal interest claimed by the bank. As a result the loss for the year ended 31st March 2015 is understated by Rs. 668.09 Lacs & current liabilities as at 31st March 2015 are also understated by Rs.668.09 Lacs and also reserves are overstated by Rs. 668.09 Lacs . The amount of penal interest cannot be quantified as the details have not been received from the bank.

Boards Comments on the same:

Based on the Legal advice received by the Company, it has been decided not to provide any interest on liability of Canara Bank.

d) As regard Auditors' remarks in the Annexure to their report under Item No. (vii) (a) and (b) and (IX) With respect to non-payment of Maharashtra VAT, Service Tax, Income Tax, Maharashtra Labour Welfare and Professional Tax the same is self explanatory

7. Loan and Investment by Company: Particulars of loans, guarantees or investments under section 186.(Annexure 2)

8. Particulars of contracts or arrangements with related parties: The particulars of every contract or arrangements entered into by the Company with related parties referred to in sub-section (1) of section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto is given in Form No. AOC-2. (Annexure 3)

9. Reserves: In the financial year 2014-15 reserve maintained with the Company is Rs. 3347.85 lacs while in year 2013-14, reserve was Rs. 3681.08. This reduction is due to retain value of Fix Assets of Rs.3.23 lacs and Loss for the year 2014-15 of Rs 330 Lacs.

10. Dividend: Your Directors do not recommend any dividend for the year under review in view of losses incurred.

11. Material changes and commitments, if any, affecting the financial position of the company which have occurred between the end of the financial year of the company to which the financial statements relate and the date of the report: No such Material changes occurred subsequent to the close of the financial year of the Company to which the balance sheet relates and the date of the report.

12. Conservation of energy, technology absorption and foreign exchange earnings and outgo: The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

A. Conservation of energy:

i. the steps taken or impact on conservation of energy: NIL;

ii. the steps taken by the company for utilising alternate sources of energy: NIL;

iii. the capital investment on energy conservation equipments: NIL.

B. Technology absorption:

i. the efforts made towards technology absorption: NIL;

ii. the benefits derived like product improvement, cost reduction, product development or import substitution: NIL;

iii. in case of imported technology (imported during the last three years reckoned from the beginning of the financial year)-

a) the details of technology imported: NIL;

b) the year of import: NIL;

c) whether the technology been fully absorbed: NIL;

d) if not fully absorbed, areas where absorption has not taken place, and the reasons thereof: NIL; and

iv. the expenditure incurred on Research and Development: NIL.

C. Foreign exchange earnings and Outgo: The Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows: Inflow: Nil and Outflow: Nil.

13. Risk management policy: Our Company maintains conducive work environment and provides adequate motivation to perform. However senior management team members or key personnel may choose to leave the organization in which case operations of our Company may be affected. However in such eventuality we will promptly fill the vacancy through either fresh recruitment or internal promotion.

14. Change in the nature of business, if any: NO

15. Directors:

A) Changes in Directors and Key Managerial Personnel:

The details about the changes in the directors or key managerial personnel by way of appointment, re - designation, resignation, death or disqualification, variation made or withdrawn etc. In the case of a public company, the name of the director who is/are liable to retire by rotation and also whether he/they offers/offer for reappointment.

B) Declaration by an Independent Director(s) and re- appointment, if any:

A declaration by an Independent Director mentioned in item number 4, 5 and 6 in the notice that they meet the criteria of independence as provided in sub- section (6) of Section 149 of the Companies Act, 2013 has been disclosed by the Independent Director to the Company.

C) Formal Annual Evaluation:

The Board has formulated a code of conduct policy for formal annual evaluation purpose which has been made by the Board of its own performance and that of its committees and individual directors.

16. Number of meetings of the Board of Directors

A) Audit Committee:

The Audit Committee has three directors i.e. one Chairman and Two members, as per The Companies Act, 2013, 2/3rd of the members should be Independent Director and Chairman should be Independent Director. All members of the Audit committee is independent director. The Chairman of Audit Committee is Mr. Lalit Laxiram Agarwal and members of the committee are Mr. Suresh Sakharam More and Ms. Kiren Shrivastav.

B) Details of establishment of vigil mechanism for directors and employees:

The Whistle blower policy of the Company was formulated and policy is available in the company's website www.tarapurtransformers.com.

C) Nomination and Remuneration Committee:

The Company has adopted policy formulated by nomination and remuneration committee for appointment of Key Managerial personal.

17. Managerial Remuneration:

a. There is no employee covered pursuant to 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014

b. There is no director who is in receipt of any commission from the company and who is a Managing Director or Whole-time Director of the Company shall receive any remuneration or commission from any Holding Company or Subsidiary Company of such Company subject to its disclosure by the Company in the Board's Report.

c. There is no such events occurs which require disclosures in the Board of Director's report under the heading "Corporate Governance", relating to the financial statement:

i. all elements of remuneration package such as salary, benefits, bonuses, stock options, pension, etc., of all the directors;

ii. details of fixed component and performance linked incentives along with the performance criteria;

iii. service contracts, notice period, severance fees;

iv. stock option details, if any, and whether the same has been issued at a discount as well as the period over which accrued and over which exercisable.

18. Details of Subsidiary/JV/Associate Companies: The Company has no Subsidiary/ JV/ Associate Companies during the year.

19. Deposits:

A. The details relating to deposits, covered under Chapter V of the Act,-

a) accepted during the year: NIL;

b) remained unpaid or unclaimed as at the end of the year: NIL;

c) whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved-

i. at the beginning of the year: NIL;

ii. maximum during the year: NIL;

iii. at the end of the year: Nil;

B. The details of deposits which are not in compliance with the requirements of Chapter V of the Act:: NIL;

20. Details of significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future: NIL

21. Auditors: M/s. Raman S. Shah & Associates, Chartered Accountants, who are the Statutory Auditors of the Company, hold office till the conclusion of the forthcoming AGM and are eligible for re-appointment. Pursuant to the provisions of section 139 of the Companies Act, 2013 and the Rules framed there under, it is proposed to appoint M/s. Raman S. Shah & Associates, Chartered Accountants, as statutory auditors of the Company from the conclusion of the Twenty Seventh Annual General Meeting (AGM) till the conclusion of Twenty Eighth Annual General Meeting (AGM)of the Company.

The Company has received a Certificate from them that their re-appointment, if made, would be within the limits and that they are not disqualified for such an appointment under the Companies Act, 2013. Their re-appointment is recommended by the board.

22. Brief description of the Company's working during the year: The Company has three manufacturing units at Boisar, Pali and Vadodara. However there is no manufacturing activity carried out at Boisar unit during the year.

23. Details in respect of adequacy of internal financial controls with reference to the Financial Statements: The Company has adequate internal financial control with reference to the financial statement as all the works relating to financial statement is done from the corporate office of the Company.

24. Share Capital

A) Issue of equity shares with differential rights: No Equity Shares with differential rights were issued during the financial year 2014-15 as provided in rule 4 (4) of Companies (Share Capital and Debentures) Rules, 2014.

B) Issue of sweat equity shares: No Sweat Equity Shares were issued during the financial year 2014-15, as provided in rule 8 (13) of Companies (Share Capital and Debentures) Rules, 2014.

C) Issue of employee stock options: No employee stock options were issued during the financial year 2014-15, as provided in rule 12 (9) of Companies (Share Capital and Debentures) Rules, 2014.

D) Provision of money by company for purchase of its own shares by employees or by trustees for the benefit of employees:

There is no such provision is made for the relevant financial year as provided in rule 16 (4) of Companies (Share Capital and Debentures) Rules, 2014.

25. Secretarial Audit Report: A Secretarial Audit Report given by M/s. Bhuwnesh Bansal & Associates, a company secretary in practice shall be annexed with the report.(Annexure 4)

26. Management's Discussion and Analysis Report: A detailed review of the operations, performance and future outlook of the Company and its businesses is

given in the Management's Discussion and Analysis Report, which forms part of this Report.(Annexure 5)

27. Corporate Governance: We adhere to the principal of Corporate Governance mandated by the Securities and Exchange Board of India (SEBI) and have implemented all the prescribed stipulations. As required by Clause 49 of the Listing Agreement, a detailed report on Corporate Governance forms part of this Report. The Auditors' Certificate on compliance with Corporate Governance requirements by the Company is attached with the Corporate Governance Report. (Annexure 6).

28. Tax Provisions: The Company has made adequate provisions as required under the provisions of Income Tax Act, 1961, as well as other relevant laws governing taxation on the company.

29. Acknowledgment: Your Directors would like to express their sincere appreciation for the assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the Company's executives, staff and workers.